Giant Network(SZ:002558) Guoyuan Securities·2024-09-05 07:30Investment Rating - The report maintains a "Buy" rating for the company [4][11]. Core Views - The company has demonstrated stable revenue growth in the first half of 2024, with a slight year-on-year decrease in revenue but an increase in net profit, driven by the successful launch of the mini-program game "King of Conquest" and stable operations of mature products [2][3]. - The company plans to distribute a cash dividend of RMB 1.40 per 10 shares to shareholders, reflecting its commitment to returning value to investors [2]. - The mini-games under the "Conquest" IP have revitalized the brand, with multiple new games launched or in testing phases, contributing to user growth and revenue [3]. Financial Performance - In H1 2024, the company achieved operating revenue of RMB 1.427 billion, a slight decrease of 1.13% year-on-year, while net profit attributable to shareholders was RMB 718 million, an increase of 8.16% year-on-year [2]. - The mobile gaming segment generated revenue of RMB 1.069 billion, up 8.11% year-on-year, with a gross margin of 90.39% [3]. - The company expects net profit attributable to shareholders to reach RMB 1.515 billion, RMB 1.681 billion, and RMB 1.848 billion for the years 2024, 2025, and 2026, respectively [4]. Business Strategy - The company is focusing on the casual competitive gaming sector, with successful titles like "Ball Battle" achieving record user engagement and revenue during peak periods [3]. - The company is expanding its distribution channels for its games, including partnerships with platforms like Kuaishou to enhance user acquisition [3]. - The report highlights the company's strategic investment in AI to empower various business operations, indicating a forward-looking approach to technology integration [4].